Report shows lakeshore companies more optimistic than regional, national peers

HOLLAND —Survey data shows manufacturers in the Holland-Zeeland area performed well in 2012, compared to their peers in the Midwest and around the nation, and look forward to more growth in the next few years.

Of the more than 200 companies whose executives were interviewed by Lakeshore Advantage last year, 77 percent said their sales were growing and 22 percent reported stable sales. Just 2 percent were experiencing a sales decline.

By comparison, 56 percent of Midwest companies and 59 percent across the U.S. reported higher sales in 2012.

Looking forward, 72 percent of local survey respondents said they planned to expand operations over the next three years, compared to 53 percent in the Midwest and 54 percent nationally.

The data shows that the Holland-Zeeland area is positioned well as the overall economy continues to improve, said Randy Thelen, president of Lakeshore Advantage.

“It certainly shows our business leaders are very optimistic in the very near term,”Thelen said. “Right now, things are really turning up in a positive way. Our companies are reporting an extremely strong 2012 and are showing signs that they intend to expand in 2013.”

Survey results also show 86 percent of companies based in the Holland-Zeeland area have introduced new products within the last five years, versus 81 percent in the Midwest and 76 percent nationally.

The data come from executive surveys Lakeshore Advantage conducts during the year that are part of a broader national effort involving about 700 economic development organizations across the U.S. The results allow Lakeshore Advantage to benchmark the local economy against other markets and to generate data to use in identifying potential problems early.

A survey, for example, that shows a growing number of companies experiencing lower sales volumes or pulling back growth projections indicates a possible economic slowdown is ahead, “and people can respond accordingly,”Thelen said.

“Going forward this is going to be a more important tool in terms of monitoring local economic dynamics,”he said.

Lakeshore Advantage has done the survey locally for a number of years. 2012 was the first year of doing it in concert with national organizations.

While data from the 2012 results were mostly positive, there was one glaring issue that continued to emerge among employers locally: Attracting qualified talent.

“As we move toward full employment, some companies have expressed concern that the quality of the labor force has declined, although it still exceeds both the Midwest and U.S. Talent development and recruitment are among the top barriers to growth in our community, and are noted as a possible reason for the inability to expand locally,” states the report from Lakeshore Advantage that highlights results from the 2012 survey. “No doubt our low unemployment rate has resulted in a tighter regional employment market. Skilled trades and technical positions are the highest concern.”

Sixty-four percent of companies responding to the local survey said that talent recruitment is a challenge, compared to 56 percent in 2011 and just 20 percent in 2010 when the economy was just exiting recession.

The survey results affirm what’s consistently been said anecdotally about the need to elevate and escalate workforce development initiatives, Thelen said.

The problem has emerged in the last two years as unemployment in the region declined.

Unemployment across Ottawa County stood at 6.7 percent in January, sixth-lowest in the state, and 7.5 percent in neighboring Allegan County, according to the state’s Bureau of Labor Market Information & Strategic Initiatives. That compares with a statewide rate of 9.7 percent in January and 2012 rates of 7.4 percent in Ottawa County and 8.2 percent in Allegan County.

A recently issued analysis by the W.E. Upjohn Institute for Employment Research in Kalamazoo shows Ottawa County employers added more than 1,000 jobs in 2012, a growth rate of 1 percent. Manufacturers in Ottawa County increased employment by 1.5 percent in the fourth quarter alone.

The Upjohn Institute forecasts that employment in the Holland-Grand Haven metropolitan statistical area will grow by 2.3 percent in 2013 and by another 2.0 percent in 2014.